Morning Reads for Tuesday, April 16th, 2013

April 16, 2013 7:54 am

by Stefan · 5 comments

 

Local first, National after the jump

 

  • Terrorist attack on Boston Marathon claims three lives (CNN)
  • Africa gives up state ownership as China arrives (Brookings)
  • The New Obama, or campaign in a can (BloombergBusinessweek)
  • How to lay down an Astroturfing plan (salon)
  • A Brief, Opinionated History of Taxes, if you dare (The Awl)
  • 5 charts that will make you feel better about paying your share (Wonkblog)
  • Stanford now about investing not thinking (NewYorker)
  • The Federal Deficit is Rapidly Shrinking(Calculated Risk)
  • The ‘laws of economics’ aren’t worth a look (Reuters)
  • The second coming of Facebook (Fortune)

 

sockpuppet April 16, 2013 at 10:10 am

The article on China and Africa is curious. The west failed to make progress in Africa for two reasons.

1. Those who professed to care about developing Africa and were willing to dedicate time and resources to it were usually left-liberals who adamantly opposed capitalism or any similar market-driven economy and – usually on the grounds of wanting to avoid colonialism, exploitation or destruction of local cultures – were trying to do their level best to keep Africa safe for socialism, and to extract as much aid from the UN, NGOs, governments etc. until the day that a workable socialist model for Africa would arrive. Or at least until western governments went socialist and were willing to subsidize it in a manner similar to what western Europe tried – and failed – to do with eastern Europe via the EU (0pen immigration for workers and education, open markets, etc.) So, in order to avoid developing the economy and infrastructure – lest it be used as the basis of an exploitative oppressive market economy – the Africa advocates instead focused on democracy, governance, human rights etc. The fact that you need an effective economy in order to produce functioning, stable governments in the first place was never conceded. The result was a waste of billions of dollars and decades of time. These folks didn’t even see the benefit in so much as building a telephone system in Africa because they didn’t feel that it would do any good (in promoting human rights and education, that is … who cares that it was absolutely necessary for commerce).

2. Folks who were more conservative, meanwhile, had no interest in developing Africa. Which was curious, because there was plenty of money to be made there. What Google is doing right now in Africa – investing a ton in Internet infrastructure that they will own entirely and will have them practically printing their own money – and make them extremely powerful – in the future. The article asks why corporate interests were willing to build factories and infrastructure in Asia and Latin America but generally avoided Africa, and came up with no good answers.

So into the void left by the well-meaning (not really … they were just trying to impose their own self-serving ideology on the place) development activists and the business folk who passed up a good opportunity to make money stepped China. They recognized that developing Africa would not only provide short term benefit to their market based (though not truly capitalist) economy, but that a developed Africa would be a useful economic and political ally against the west. Imagine if 25 years from now Africa has factories, infrastructure, telecommunications, a growing GDP … a goods producer in addition to their vast natural resources. That would give them economic clout which translates to political clout, and it would be clout on Africa’s side.

The curious thing is that our opportunity to do what China is doing now with Africa was during the Cold War, when it could have been done much more cheaply. But for some reason, a Marshall Plan for Africa to use it as a bulwark against the Soviet Union and the Asian communist regimes never struck anyone as a good idea, which was strange since Arabia and North Africa generally sided with the Soviets so it would have been a logical strategic move. But now China is building up Africa in order to have their ally against the west.

Really, the whole thing smacks of a gigantic blown opportunity that created an opening for China (and Google) are going to benefit from.

MattMD April 16, 2013 at 6:41 pm

Arabia generally sided with the Soviets during the Cold War? That’s news to me.

cheapseats April 16, 2013 at 11:37 am

Well, as an avowed capitalist but with modest means, I was very interested in Africa about 10 years ago but my contacts there let me know that the workforce was extremely unreliable due primarily to sickness and disease.
I would have been more than happy to get something going there and maybe even help their population while I was making money but, the labor situation combined with the corruption in almost every market I explored made it just too risky for a small-timer like me.
Google has the pocket-depth to make a go of it so, more power to them!

saltycracker April 16, 2013 at 5:28 pm

China in Africa has no hang ups with oppressive governments, human rights violations, ecological and environmental destruction, arms sales or anything that would get in the way of exploiting the continent. As Europe backed off from colonialism they began behaving better which left them exposed to the mercenaries, internal and external.

The Last Democrat in Georgia April 16, 2013 at 11:05 pm

Thanks for the news, Stefan.

Comments on this entry are closed.